Google rejects tax-siege claims

Peter Cai

The head of Google Australia has rejected the suggestion that the company is under siege from tax authorities around the world despite many governments saying they intend to crack down on tax minimisation by multinational corporations.

In November, Assistant Treasurer David Bradbury took the unprecedented step of criticising by name two US technology giants, Google and Apple.

Google Australia reportedly paid tax of either $74.176 or $781.471 in 2011 on its estimated Australian revenue of at least $1 billion.

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An expert panel set up by Mr Bradbury has recommended legal changes to make public more information about how much tax is paid by multinational companies such as Google.

However, on Wednesday the managing director of Google Australia and New Zealand, Nick Leeder, said: "We don't feel particularly under siege. We understand the issue and it is an important issue."

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He said the issue could only be resolved through international co-operation and Google looked forward to working with the Organisation of Economic Cooperation and Development, which has called for an overhaul of international tax laws.

"We understand there is an issue around the world and it is one that requires co-operation from different countries," Mr Leeder said. "You can't solve this issue one country a time. I think the OECD is exactly where this issue needs to be dealt with."

In a report published last week blaming "profit shifting" for eroding the tax base, the OECD warned the practice "constitutes a serious risk to tax revenues, tax sovereignty and tax fairness" around the world.

Mr Leeder defended Google's record, saying that "as a company you have a duty to your shareholders to make sure that your structure is efficient so we can compete with other big companies".